Trending Global Business Risks of 2022

Trending Global Business Risks of 2022

Some scientists have said: “...the best predictor or future behaviour is past behaviour...”

With regards to global events at least, this can be one of many useful indicators for both large and small businesses.

There is no doubt that we are living in transformative times. Artificial Intelligence, shifts in social consciousness, a new generation of thought-leaders, global warming, and a worldwide pandemic, are all changes that are shaping our futures.

It stands to reason that new risks need managing, for you and your business to be sustainable.

Industry experts predict that the top 6 business risks, companies need to protect themselves from are:

  1. Cyber Incidents
  2. Business Interruptions
  3. Natural Disasters
  4. Pandemic Outbreak
  5. Changes in Legislation and Regulation 
  6. Labour Shortages

Insurance Advisernet delves into these in more detail - to keep you covered.

1. Cyber Incidents

Businesses heavily affected by several risks during recent years are increasingly worried about data breaches, large-scale IT outages and the threat of ransomware attacks. 

Cybercrime sits in the pole position of global business risks for 2022, topping supply chain disruption, natural disasters and the COVID-19 pandemic.

According to the Cyber Security Centre, a staggering $300m was lost daily to cybercrime, significantly impacting small businesses in 2019. 

Cybercrime is not just a risk for global companies where a data breach can cause enormous problems for staff and customers, but crucially, it’s a growing problem for SMEs. 

According to other recent reports, experts have uncovered that a huge 43% of cyber-attacks are specifically aimed at smaller enterprises. Worryingly, only 14% of those are taking steps to protect themselves. 

Proving that larger data security risks are a real threat but everyday security is paramount. 

Employers clicking on external links, working from a hacked website, or even simply sending an email to the wrong person could leave your business exposed.

It's also worth noting that according to new legislation, it’s now mandatory for any qualifying Australian business to notify a cyber breach to all parties that are affected, including the Australian Privacy Commissioner.

Speak to your local insurance representative about tailoring a cyber Insurance solution for your business – together we can ensure a robust insurance strategy is in place, to protect against this widespread 2022 global risk.

2. Business Interruption 

Any situation which causes prolonged disruption to your business, is a significant problem.

It’s crucial that companies’ business risk management plans are effective, to deal with unforeseen events, and then finding appropriate solutions.

Depending on your needs, Business interruption insurance can protect against loss of income when unable to carry out normal work. It also may help to continue paying crucial leases and rents, even if your business is not currently operating. 

By safeguarding your business with this type of insurance, you will be best placed to recover, back to ‘business as usual’, ensuring survival of any unexpected catastrophes. 

Trending Global Business Risks of 2022
 
3. Natural Disasters 

According to recent reports, the recent NSW and QLD floods were one of the most costly disasters in Australian history with some Australian towns and businesses almost ruined and brought to their knees. 

Natural disasters such as floods and earthquakes can strike without warning and drive some enterprises into difficulties that could become a serious problem for their survival. 

Savvy entrepreneurs understand that a business pack insurance policy, can help protect your company from unforeseen circumstances that hit the top spots on the global risks list for 2022. 

A business insurance policy can help to protect your business and can include: 

  • Natural Disasters 
  • Fire and Explosions 
  • Extreme Weather 
  • Office Equipment, Buildings, Plant and Stock Assets 
  • Your Legal Liability for Injury on your Premises 
  • The Continuation of your Business in the Event of an Insurable loss. 
4. Pandemic Outbreak

According to a recent McKinsey report, the COVID-19 pandemic caused airline revenues to drop by 60% in 2020. So, it’s probably no surprise that the pandemic outbreak is listed in our ‘Trending Global Business Risks of 2022’. 

The extra uncertainty and confusion concerning pandemic responses and government approaches have left many companies in precarious positions. 

With the challenges of the emerging variants and the chaos surrounding vaccination programmes, knock-on effects to other business risks have been felt. 

The pandemic has meant many businesses have adapted to swiftly changing circumstances. Others, though, have been left behind, and not every enterprise will benefit from the predicted follow-up boom period.

For businesses to survive the fractured predicted recovery period, it’s crucial to review how risks are mitigated to be resilient in any future pandemics.

Trending Global Business Risks of 2022
 
5. Changes in Legislation and Regulation 

Australian legislation and regulations are ongoing. Although some industries promise to reduce new rules and regulations, the reality is often different. 

2022 will be no exception. This is especially true in sustainability and big tech areas, where scientists continue to study the irreversible effects of climate change amongst other investigations. 

According to banking giants HSBC, climate change, digital innovation and cyber protection are on the regulation hit list. 

In terms of climate change regulations, global players such as the United Nations Environment Programme (UNEP) are already putting regulations in place to keep global warming below 1.5°C. 

For this reason, companies will have a reasonability to act and show they are putting nature-based solutions in place. 

6. Labour Shortages

One of the biggest challenges facing Australian Businesses is labour shortages. According to recent reports, the Australian PM has referred to the shortages as “the single biggest challenge facing Australia’s economy”. 

Many SMEs have been hit hard by the issues created due to a dwindling workforce.

The global pandemic has led to chaotic supply chains, employee burnout and problems with staff shortages. Australian business owners are facing more and more challenges in obtaining and crucially, retaining staff.

Many companies are finding more creative ways to deal with this ‘Trending Global Business Risk of 2022’. 

Staying productive and remaining buoyant will continue to be a difficulty faced by a growing number of businesses of all sizes. 

Always Protect Your Business with Insurance 

Is your business fully prepared for a sustainable future? Do you have suitable insurance protection in place to protect your bottom line? 

Some of these risks are beyond anyone’s control, but by implementing a robust insurance plan, you can effectively mitigate against the ‘Trending Global Business Risks of 2022’. 

Companies who annually review their insurance policies, will be in a stronger position with any aftermath of adverse events and absorb those losses by claiming. 

Speak to one of our insurance advisers’ who is an expert in your industry. Together, you can design a bespoke strategy. With tailored solutions in place, your company will better manage all your business risks.

Click here to find your nearest adviser.

 

Important Information 

This communication including any weblinks or attachments is for information purposes only. It is not a recommendation or opinion, your personal or individual objectives, financial situation or needs have not been taken into account. This communication is not intended to constitute personal advice.

We strongly recommend that you consider the suitability of this information, in respect of your own personal objectives, financial situation and needs before acting on it. This document is also not a Product Disclosure Statement (PDS) or a policy wording, nor is it a summary of a particular product’s features or terms of any insurance product. If you are interested in discussing this information or acquiring an insurance product, you should contact your insurance adviser to obtain and carefully consider any relevant PDS or policy wording before deciding whether to purchase any insurance product.

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